Business News of 2013-03-04

Boosting entreprenuerial skills - NBSSI and Commonwealth explore business growth options

For a long time in Ghana, micro, small and medium enterprises (MSMEs) have been the heartbeat of national economic growth.

Apart from offering employment to a large number of people in the informal sector, they also serve as major suppliers to large scale enterprises, thus making very significant contributions to the country’s gross domestic product (GDP).

One significant attribute of SMEs is the fact that they are spread across the country, particularly in the rural areas, delivering essential services to the people.

It is, however, unfortunate that even as they make significant contribution to national economic development, the SMEs themselves had suffered from stunt growth due to a number of factors, chiefly among which the lack of business planning skills.

It is to address this business challenge that the National Board for Small Scale Industries (NBSSI), in collaboration with the Commonwealth Secretariat, rolled out training programmes between 2011 and 2012 to bridge that knowledge gap.

Knowledge and skills gap

Prior to the beginning of the Commonwealth Secretariat’s training project, a situational analysis undertaken by the team of experts had revealed that although NBSSI staff had undergone a considerable amount of training in the past, they were not able to adequately translate the knowledge acquired into skills for use at the workplace.

The previous training, according to the analysis, had been classroom-based and the trainees did not have the opportunity to apply the knowledge acquired, turn it into skills and practice same within the training schedule.

Furthermore, it was observed in the situational analysis that in the past, many of the NBSSI’s training for MSE entrepreneurs focused on traditional skills, which were often an extension of domestic activities, such as tailoring, handicrafts, food processing and catering.

There was also an indication that many of the NBSSI’s Micro Small Enterprise training programmes were aimed at developing technical skills which, in most cases, required the input of external experts and budgetary approval.

The expert team observed that there was a need to strengthen essential business skills within the NBSSI Business Advisory Centre’s network that affected its ability to train MSEs to provide good quality, innovative products or services at a competitive price.

“In addition, many MSEs are not skilled in running businesses effectively and lack basic business knowledge in the critical areas of bookkeeping, product costing, business planning and marketing,” the expert team noted.

Commonwealth Secretariat project

Informed by these knowledge and skills gaps, the expert team of the Commonwealth designed a well-tailored training programme to expose the NBSSI BAC frontline staff more to ‘what to do’ regarding specific areas of new product development and market access, and more importantly, ‘how to do it’ .

The training programme, which was on the topic “Business planning for new product development and market access” sought to develop the skills of NBSSI staff at the Business Advisory Centres (BACs) across the country so that they would in turn assist SME operators with such business planning skills to enhance their growth.

After an 18-month period of the project, 46 NBSSI BAC frontline personnel were trained. One unique aspect of the project was that 14 SMEs were assisted, having partnered with the trainees to produce an appropriate new product or service or market access business plan for each of them.

Based on the recommendation of the project expert team, and to make the training as relevant as possible, the trainees worked closely with NBSSI SME clients, which helped them to develop practical skills in a real life scenario.

At one of the training programmes in December 2011, Mr Roland Charles, an Adviser of Enterprise Development at the Special Advisory Services Division of the Commonwealth Secretariat,gave the assurance that the Secretariat would offer the needed support to enable Ghanaian SMEs to realise their objectives.

He noted that global economic challenges were badly affecting the development of SMEs but he expressed the hope that the training programmes would be beneficial to the SMEs.

Impact of Commonwealth project

Indeed, the training programme, which fits well with the commonwealth theme# “Opportunity through enterprise” was highly successful as feedback from the NBSSI staff and the trainees indicated outstanding outcomes.

Apart from the knowledge gained by the NBSSI trainees, awareness had also been created on best practice roles and responsibilities of business development service (BDS) providers, indicating a successful transfer of practical skills.

According to Mr Charles, the success of the project was partly due to the ability of the Commonwealth Secretariat to respond to the extension of the terms of reference recommended by the project expert team which was identified as necessary following an extension situational analysis undertaken during the inception period of the project.

“The Commonwealth Secretariat has provided a fully-tailored highly effective training programme project which has met the identified needs of the NBSSI,” he remarks.

“It will undoubtedly have a long term and lasting impact on the organisation and its staff and also on the SMEs.” The provision of services such as management training, including market access and financial planning, had been very beneficial to the trainees.

Way forward

From a difficult situation, the future now looks bright for Micro Small Enterprises and with the benefit of the Commonwealth Secretariat’s training programme, MSEs in the country are expected to experience enhanced growth and make greater contribution to national economic growth and development.

It is, however, important for NBSSI to reposition itself and take some initiatives that would make it more relevant to the needs and growth of MSEs.

For instance, in order to manage the delivery of the various types of business development services it offers, NBSSI should improve its commercial approaches and practices. This could be achieved by recruiting staff with greater business experience.

Again, whilst there is the need for NBSSI to be flexible and willing to meet the demands of their MSE clients, it is also important for it to be aware of existing and potential budgetary constraints and not to plan in excess of expectations.

Having benefitted from the Commonwealth training programme, it is imperative for NBSSI to endeavour to address the basic knowledge gaps within the MSEs and use the knowledge acquired as tools to build their capacity.

The NBSSI must also find ways of improving business linkages between the MSEs and bigger firms to help overcome problems MSEs face in respect of raw materials input supplies and marketing.

Furthermore, NBSSI must ensure that all interventions are embedded within the monitoring and evaluation system, which will allow management to review and adapt interventions and activities as appropriate.

It is also important for it to consider ways of replicating successful enterprise models within the MSE community, such as franchising. There is no doubt that the Commonwealth Secretariat and NBSSI have made very useful contribution to the growth and development of MSEs in the country.

However, in order to ensure maximum success, it is imperative that NBSSI is adequately resourced with funding and logistics so that is can discharge its mandate effectively.